Warner Bros. Rushing Out Chinese DVDs to Beat Counterfeiters

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Hollywood studio Warner Bros. is taking on the pirates in China's film market, using lightning-fast home-video release and low prices to beat DVD counterfeiters at their own game.

Warner's China film-making joint venture released its first picture, a low-budget film called "Crazy Stone," in cinemas on June 30, then followed with a DVD version selling for as little as 10 yuan ($1.25) just 12 days later.

The turnaround was the shortest ever for a Warner film, in an industry where three months is more typical, said Tony Vaughan, managing director for CAV Warner Home Entertainment Co., another Warner joint venture that handled the film's home video release.

"We came out here with the aim of competing with the pirates on pricing and timing," said Vaughan. "The fact that we've been able to go this early means we've been able to beat the pirates."

Warner, the studio division of Time Warner Inc. (TWX), has been one of the most aggressive of the major Hollywood studios to try to carve a niche in China — a market beset with rampant piracy and tough restrictions on imported films.

"Crazy Stone," the Warner film venture's first release, has also been a success in its own right at cinemas in China, scoring $1.5 million at the box office to date after being made for less than $400,000, said Ellen Eliasoph, a director at the venture.

Piracy in China cost film-makers an estimated $2.7 billion last year, with domestic firms shouldering more than half those losses, according to a study commissioned by the Motion Picture Association of America, which represents major Hollywood studios.

The study estimated 93 percent of all movie sales in China were pirated versions.